Breaking Down the Budget Agreement 2016: What You Need to Know
On May 2, 2016, after months of negotiations and partisan wrangling, the United States Congress passed a bipartisan budget agreement that funds the federal government for the rest of the fiscal year and avoids a shutdown or a default. The budget deal, which now awaits President Obama`s signature, provides $1.07 trillion in discretionary spending for various programs and agencies, and includes several policy provisions that affect everything from taxes to healthcare to energy.
Here are some highlights of the Budget Agreement 2016:
1. More Money for Defense and Domestic Programs
The budget deal increases the caps on defense and domestic spending for 2016 and 2017 by $80 billion, split evenly between the two. This means that the Department of Defense will have $551 billion in its base budget, while non-defense programs will have $518 billion. Some of the areas that will see extra funding include education, medical research, transportation, and veterans affairs.
2. Changes to Social Security and Medicare
The budget deal includes several changes to Social Security and Medicare that will affect some beneficiaries. For example, the legislation eliminates two popular strategies that allowed some couples to maximize their lifetime benefits by delaying their claims. It also increases the premiums for some high-income Medicare beneficiaries and extends the solvency of the Social Security Disability Insurance program by reallocating some payroll tax revenues.
3. Tax Relief and Credits
The budget deal extends or makes permanent some tax breaks and credits that were set to expire or phase out. For example, it makes permanent the deduction for state and local sales taxes, which benefits taxpayers in states without an income tax. It also extends the Earned Income Tax Credit and the Child Tax Credit, which help low-income and middle-class families, and the research and development tax credit, which encourages innovation by businesses.
4. Energy and Environment Policies
The budget deal includes some provisions related to energy and the environment that have received mixed reactions from both sides of the aisle. For example, it lifts the 40-year-old ban on crude oil exports, a move that some Republicans and oil companies have long advocated as a way to boost the economy and national security, but that some Democrats and environmental groups have criticized as harmful to the climate and public health. It also extends some tax credits and incentives for renewable energy and energy efficiency, which many Democrats and environmentalists have praised as good for the environment and economy.
5. Other Provisions
The budget deal also includes some other policy provisions that may interest some people, such as:
– Delaying the “Cadillac tax” on high-cost employer-sponsored health plans until 2020, a provision that many unions and businesses have sought as a way to avoid higher costs or reduced benefits.
– Reforming the visa waiver program for travelers from certain countries, a move that aims to improve security and screening measures after the Paris terrorist attacks.
– Increasing funding for the National Institutes of Health and the Centers for Disease Control and Prevention, which have been involved in fighting Zika and other health threats.
– Providing $1.8 billion in emergency funding to combat the opioid epidemic, a crisis that has affected many communities across the country.
While the budget agreement 2016 may not satisfy everyone`s wishes or concerns, it represents a compromise that reflects the political realities and priorities of the current Congress and administration. As a citizen and a taxpayer, it`s important to stay informed and engaged in the budget process, and to hold elected officials accountable for their actions and decisions.